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Pacific Nations Conclude PACER Plus Trade Agreement Negotiations

Submitted by PIR Editor on Thu, 04/20/2017 - 17:13

After eight years, deal is ready for signing, ratification

By Anna Vidot

MELBOURNE, Australia (Radio Australia, April 21, 2017) – After eight years of negotiation, Australia and New Zealand have reached agreement on a trade and development deal with 12 other Pacific nations.

Once ratified, the Pacific Agreement on Closer Economic Relations (PACER) Plus would create a regional trading bloc that "recognises the vulnerabilities" of its smallest nations, New Zealand Trade Minister Todd McClay said.

Australian trade minister Steven Ciobo said the agreement aimed to balance trade and development goals across the region.

But two of the largest Pacific economies are not involved: Papua New Guinea and Fiji earlier pulled out of PACER Plus negotiations, citing scepticism about its economic benefit for their nations.

Papua New Guinea has since said it would prefer bilateral deals with Australia and New Zealand, but Mr Ciobo said Australia saw PACER Plus as the pathway for any agreement between the two countries.

Solomon Islands Trade Minister Milner Tozaka said the agreement would benefit his and other Pacific nations, and praised Australia and New Zealand for their leadership in reaching a deal.

"Australia and New Zealand are not only going to help us in implementing the agreement, but we are so pleased that they are also going to help us in modernising our trade-related infrastructure and enhance our productive capacity," he said.

Australia appears to have made no further labour mobility concessions under PACER Plus, but Mr Ciobo said the Pacific Seasonal Worker Scheme had already been expanded under recent initiatives, including the Northern Australia White Paper.

New Zealand pushing for better access

The agreement comes amid a backdrop of growing anti-globalisation sentiment, following the Brexit referendum and the election of Donald Trump to the US presidency.

Mr Trump torpedoed another, more ambitious trade deal for the region — the 12-nation Trans-Pacific Partnership (TPP) — in January, calling it a "rape" of his country.

New Zealand was a founding participant in the TPP negotiations, and Mr McClay said his nation had not given up on the deal despite its rejection by the US.

"New Zealand will always be involved in any conversation which will give better and fairer access for New Zealand businesses to important markets overseas," he said.

"We see economic value in the agreement going ahead.

"But I think more importantly today, as many parts of the world talk about trade protectionism, we see great strategic value in a common set of rules that mean that businesses in New Zealand and Australia and all of the countries are treated fairly.

"[That] is important to fight for and so New Zealand plays a constructive part in that conversation."

Moves to revive TPP ongoing

Mr Ciobo previously conceded that the TPP was "dead" without the US, but has since spoken of wanting to secure the "principles" of the agreement with the other remaining members.

He said he was "working closely" with Mr McClay on reviving the deal, which they were "discussing frequently".

"I've just come from discussions in Japan where I met with my ministerial counterpart and other ministers to discuss Japan's position with respect to a TPP-II," Mr Ciobo said.

"I remain very hopeful that we'll be able to secure agreement."

Ministers from the remaining TPP nations will meet again in May to discuss the future of the deal.

Pacific Islands Report is a nonprofit news publication of the Pacific Islands Development Program at the East-West Center in Honolulu, Hawai‘i. Offered as a free service to readers, PIR provides an edited digest of news, commentary and analysis from across the Pacific Islands region, Monday - Friday.